Stock Tips: Maruti’s shares have broken out of the four-month consolidation range and now there is a possibility of a rise in it.
Maruti Suzuki Outlook: Shares of the country’s largest car company Maruti Suzuki today rose one percent from Thursday’s low to reach a price of Rs 8,699.8. However, it is still at a discount of about 4 percent from the record price of Rs 9022 for 52 weeks. Shares of Maruti Suzuki reached this high level in February 2022 and now according to brokerage firm ICICI Direct Research, it can strengthen 7 per cent in just three months. The domestic brokerage firm believes that the stock has broken out of the four-month consolidation, indicating further upside signals and is a good investment opportunity. ICICI Direct has set a target price of Rs 9250 for investing in this with a stop loss of Rs 7740.
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That’s why experts are placing bets
- According to ICICI Direct, the auto and auto ancillary space looks promising as the Nifty Auto index is on the verge of breaking out of several year highs since calendar year 2017. Maruti is a better choice to bet in large cap auto stocks.
- Coming to the technical chart, Maruti Suzuki shares have remained above the 52-week EMA (Exponential Moving Average) since August 2020 and made higher lows, indicating increased buying demand.
- After breaking out of the four-month range, it is now showing signs of bullishness and this stock can reach the level of Rs 9250 in the coming four months.
- Coming to the weekly RSI (Relative Strength Indicator), it is moving above the nine-period average, which gives positive signals for the stock.
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- Maruti Suzuki is rapidly adopting new technology through the new Baleno, new Ertiga, XL6 and Brezza.
- The company has also been moving fast in the CNG fuel scheme and the company sold more than 2.3 lakh CNG-powered vehicles in the financial year 2022. In the case of CNG cars, Maruti Suzuki has a market share of 15 percent and according to ICICI Direct it will grow further.
- In the case of EV, the company is proceeding cautiously and its first electric vehicle (EV) can be launched in the year 2025.
- In the SUV space, the company recently launched the new version of Brezza. Apart from this, preparations are also being made for the new launch.
- Maruti Suzuki is also likely to benefit from the strengthening of the rupee against the Japanese yen and the falling prices of the metal.
(Article: Surbhi Jain)
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